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EXCLUSIVE: Mitchells Stores Buys Stanley Korshak

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The Mitchells are adding to their arsenal. On Tuesday, the Connecticut-based luxury specialty retailer revealed that it has purchased Stanley Korshak. The venerable Dallas-based men’s and women’s emporium, whose history dates to 1909, will become part of what is arguably the country’s most successful high-end independent retail chain, counting Mitchells and Richards in Connecticut, Marios in Portland, Ore., and Seattle, and Wilkes Bashford in San Francisco and Palo Alto, Calif., among its holdings. The company also has a Mitchells store in Huntington, N.Y., that was formerly a Marshs. That business was acquired in 2005 and rebranded in 2015. Related Articles Mens Retail Business Taylor Stitch to Open First Store in a Decade in Seattle Beauty Features Is the Billion-dollar Beauty Club Still a Thing? All told, the eight stores have annual sales in excess of $200 million, and Korshak, whose reported volume is in the range of $50 million, will add to that figure. You May Also Like Terms of the acquisition were not disclosed and Crawford Brock, who has managed Stanley Korshak since 1987 and purchased the business in 2002, will remain with the company. “Crawford is going to be our partner going forward and will be leading the charge with Martha Leonard, who’s also been there a long time,” said Bob Mitchell, co-chief executive officer of Mitchells Stores. Leonard serves as senior vice president and general merchandise manager of Korshak and has been with the company almost exclusively since 2007, with just a short stint where she worked at rival Dallas retailer Forty Five Ten. “We’re going to listen and learn and grow with each other.” Mitchell said his company has long viewed Dallas as a city ripe for expansion of its high-end luxury retail strategy. But rather than opening a store to compete with Korshak, they decided to work together.  “We love the idea of partnering with other existing retailers who we can learn from,” he said, adding: “It’s two strong companies coming together. I think that’s really a great testament to the wholesale and multibrand model working. It’s going to be two companies that are already excelling that are going to help each other.” Stanley Korshak has been part of the Forum Group since 2000. That group is a collection of independent stores around the U.S. that share experiences and strategies. “For close to 25 years we have traded ideas and dreams, now we get to jointly execute them,” Brock said. Brock said shortly after joining the Forum Group, he recalls sitting on a plane next to Jack Mitchell, Bob Mitchell’s father and the-then CEO of the business, and they started talking about exit strategies. “I said, ‘Jack, I was hoping that you’d be mine,’” he recalled. “And he said, ‘You know, we’d consider that some day.’ So it is something that’s been on my mind over time.” Brock turned 70 in May, and while his three daughters work in the business, he said they’re young mothers and not able to devote the time and effort to being there full time. Crawford Brock with his three daughters. Stanton Stephens And although he had been approached over the years by private equity firms exploring an acquisition of the business, “I was warned about those guys by friends of mine,” Brock said, and the smarter move to ensure the future of the business was to find a “strategic partner. They’re operators and they get it,” he said of the Mitchells. “Bob and I can talk on a level of understanding about how we’re going to drive the business forward.” While many of the brands carried at both stores overlap, Brock said there are additional labels at Mitchells that will most definitely enhance the mix at Stanley Korshak. In addition, the Mitchells’ online app and strong marketing will benefit the Dallas-based business, he believes. “It’s going to be a really good marriage,” Brock said. “I can’t think of a better family-run business in America that can continue the hard work we’ve done. This partnership will open up an expanded universe of world-class product, inventory, technology and services to our customers.” He also pointed to the impending closure of Neiman Marcus’ downtown flagship and its local buying office as an opportunity for Stanley Korshak. “My phone’s ringing off the hook, and I don’t want to get too much into that, but we’re a legacy business and there’s an opportunity for Korshak to pick up some of that business. The timing couldn’t be better.” Stanley Korshak traces its roots to Chicago, where its namesake founder opened a women’s designer apparel store in 1909. The business thrived for many years until falling on hard times in the 1980s, at which point Dallas oil heiress and developer Caroline Rose Hunt purchased the rights to the name and opened a store in the courtyard of shops in the Crescent Hotel in Dallas in 1986. The Chicago store closed in 1990. Mitchell said that today, Stanley Korshak, which spans 55,000 square feet and includes a popular bridal salon, is “one of the largest single store operations in the United States. I love that it’s a super-successful business that we can learn from and bring to all our other stores. And it continues in my mind to demonstrate that our formula is a winning formula for continued success. There’s so much talk about the multibrand wholesale model being stressed, but we just don’t see it. We believe it’s actually our moment in time. There’s a lot of upheaval in the market, and luxury customers want to shop in great environments with the best brands in the world and professional sales associates. And Korshak checks all three of those boxes. Plus, to have Crawford stay on and help lead the charge with us, I think we’ve got a winning formula. And without sounding presumptuous, we’ve done it a few times already, so we know what we’re doing.” The Mitchells followed the same strategy when it purchased Richards, Wilkes Bashford and Marios, keeping the founders or longtime operators on board as ambassadors to help with the transition and work with customers. The Mitchell family has managed to buck the trend of other retailers, notably in Seattle, Portland and San Francisco, cities that other merchants have abandoned. Within the past two years the Mitchells invested around $10 million renovating the Marios flagship in Portland and the Wilkes flagship in San Francisco. Last November, they opened a 9,000-square-foot Wilkes Bashford store in the Stanford Shopping Center in Palo Alto that is nearly three times the size of its predecessor and the largest new multibrand specialty store in the country. It was the first store the company built from the ground up since Richards in Greenwich was recreated in 2000. The new Wilkes Bashford store in Palo Alto, Calif. Courtesy of Wilkes Bashford “We’ve had such tremendous growth in markets where most people are not growing,” Mitchell said. “And Dallas is a booming market already so it gives us an opportunity to grow with all of our vendors who believe in us and have stuck with us. A lot of the big brands that are not doing a lot of wholesale are continuing to choose us.” He attributed this in part to the fact that four generations of the Mitchell family are active in the business. Mitchells Stores actually had a humble beginning when Ed and Norma Mitchell opened an 800-square-foot men’s store in a former plumbing supply shop in Westport, Conn., in 1958 with “three men’s suits, a coffee pot and a dream.” Over the years, the business grew and began absorbing its competitors through a number of well-thought-out acquisitions of businesses with similar vendor mixes and history. Many of those started as men’s-only stores and then added womenswear. Today, women’s is actually a bigger business for the company than men’s, accounting for around 56 percent of sales as a whole. Jewelry has also become a big business for the retailer. The Mitchell family has built a $200 million business of luxury retail stores around the U.S. Courtesy of Mitchell Stores As has become its strategy, a Mitchell family member will work closely with Brock and Leonard on integrating Korshak into the fold. In this case, it’s Chris Mitchell, who took on a similar role with Marios, and will spend half his time in Dallas working with the associates to ensure their relationships with the Dallas community continue uninterrupted while Brock serves as the “consummate host,” Mitchell said. “Then we’ll evaluate what’s the best opportunity for the future, whether it’s a Mitchell or a non-Mitchell.” “Stanley Korshak is a jewel in Texas and we will do everything to help Crawford and his team continue to offer world-class products and services that are perfectly tailored to the Dallas customers,” said Chris Mitchell. Brock added: ““The only thing we love more than fashion is the customers we are privileged to serve. Nothing will change regarding the extraordinary service for which we are known. The Mitchells have a long history of keeping what is special about each local store while providing significantly enhanced inventory and technology. Our highly regarded sales associates will still be the heart and soul of our stores and our buying and management team will continue to keep Korshak a locally targeted store. The only changes our customers will see are the ways in which we are able to serve them even better.” The mix at Korshak is very similar to Mitchells’ two Connecticut stores, Bob Mitchell said, with menswear and womenswear each accounting for 40 percent of sales, and jewelry the remaining 20 percent. Bob Mitchell said the buying team will work closely with Dan Farrington, who heads menswear for Mitchells Stores; his wife Jennifer Farrington, who is general merchandise manager of jewelry, and Angela Pieretti, who oversees womenswear. “We think it’s one plus one equals three. Dallas is one of the top five luxury markets in the world so Crawford is going to be in a contest to surpass Greenwich as our number-one store,” he said with a smile. “We certainly think the market supports it.” While Bob Mitchell would not provide a sales price for Korshak, he said Mitchells did not have to take on any debt to make the acquisition. “We don’t like to do too many of these things at one time,” he said. “We want to focus and execute with a super strong financial balance sheet so all of our partners feel good about what we’re doing and have confidence.” As news of the acquisition spread, vendors were quick to offer their support. “I extend my warmest wishes to the Mitchells and Stanley Korshak families as they join together in this new chapter of their storied legacies,” said Brunello Cucinelli. “For generations, these two families have exemplified the highest values in luxury retail, deeply rooted in the art of relationships, community and exceptional service. This union is a testament to the power of tradition and vision coming together to strengthen the American retail landscape.” “We are proud to call the Mitchell family our friends and our partners for decades,” said the Paone family, owners of Kiton. “Their reputation for excellence and relationships with designers from around the world will perfectly expand and complement the magnificent selections and experience at Stanley Korshak.” Sylva Yepremian of Sylva & Cie, a Los Angeles-based jewelry brand, weighed in:“Congratulations to Stanley Korshak and the Mitchell family as they unite to write the next chapter in luxury retail. With decades of refined taste and expertise, both bring unparalleled knowledge to this partnership. Like two rare gems perfectly paired, these style icons are even stronger together. We are thrilled to be part of this exciting new venture.”

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